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This might be the most important newsletter you have
received from me if you are a business person who uses your car to cross into
the United States for business purposes or just to pick up something from the
other side of the border if the item will be used by you for business purposes.
Let me
explain.
The United
states has a $5.00 fee which is assessed against a vehicle which will be used
to transport business goods into the US or OUT of the US.
I have paid
this a couple of times when asked to but I had no idea of the real significance
of the $5.00 fee until I asked a US Customs officer the question as an aside
while preparing his income tax returns.
His answer
astounded me and even though he stated that the $5,000 fine would likely NOT be
applied on a first offence, it is possible that it could be and we have Gordon
Campbell as an example of what can happen.
The rules
are clear. If you are going down to Bellis Fair Mall to pick up a printer
cartridge or a box of burnable CD's for your office, you HAVE TO tell the
admitting officer this and go into office and pay your $5.00.
If you do
not and you get stopped by the "outgoing patrol" and they find your commercial
item, the fine is:
1. Seizure of your vehicle
2. Seizure of the item(s)
3. A statutory fine of
$5,000 US.
Why would
they stop your car going "out" of the US. Well, if they found more than
$10,000 of currency on you, the fine could be up to $500,000 plus 5 years in
jail. Or, they might be looking for drugs, etc.
This really
applies to me. I have made seven trips this past year to pick up items that I
have bought on eBay. Half of them were for personal items but the others
were to pick up printers, computers, monitors, and printer cartridges.
I don't need
to buy a permit to pick up a personal computer for my house. But if I buy two
and one is going to the office, I better buy a permit.
Therefore,
if you are taking down 1,000 flyers to mail out, buy your permit;
if you are going down to bring back a printer for the office, buy your permit;
if you "THINK" you might buy something for the office, buy your permit.
It is a lot easier to buy it on the way in, then on the way back. Traffic
patterns are too hard coming back.
If you are a
California resident and taking a bunch of bedding up to your rental condominium
in Whistler, you have to buy a permit.
If you are a
US resident (maybe a courier) and you take a package up to deliver in Vancouver
or Toronto or Winnipeg, you have to buy the permit.
The permit
is for the "VEHICLE". If you bought a permit on the way down and your
Jaguar breaks down in Seattle and you rent a Cadillac to get home while they
fix the Jag in Seattle and you bring back a new computer for the office, you
have to buy another permit for the Cadillac because the one in your wallet is
for the wrong vehicle.
If you are
going across on a regular basis, you can buy a $100.00 permit for the year but
remember, it is for "that" vehicle. If you buy a $100.00 annual permit
and are going across the next week with your spouse's car on commercial
business, you need to buy another $5.00 permit.
If you are just using your car to make a
sales trip and are not leaving anything with the client and are not bringing
anything back, you do not need a permit. However, you must also remember
that it is illegal to call on two clients and leave something with each of them
- even if you have a permit - BECAUSE YOU ARE NOT ENTITLED TO GO FROM PLACE TO
PLACE DROPPING THINGS OFF.
IF YOU WANTED TO CALL ON TWO STORES AND
LEAVE A SAMPLE WITH EACH OF THEM, YOU SHOULD RETURN ACROSS THE BORDER BEFORE
YOU MAKE THE SECOND CALL OR BE PREPARED TO HIRE AN AMERICAN TO HAND OVER THE
ITEMS. BETTER TO HAVE SENT THEM DOWN IN ADVANCE.
I send you
this with my compliments and thanks to an anonymous US Customs Officer.
Please also
note that we have added Mexico to our office. We have the services on a
part time basis of a Mexican CPA with impeccable credentials in trade with
Mexico. If you are thinking of dealing in Mexico, please call.
david ingram -
taxman@centa.com
108-100 Park Royal South
West Vancouver, BC, CANADA, V7T 1A2
(604) 913-9133 - (604) 913-9123
www.centa.com
Cell is (604) 657-8451 (10 AM to 10 PM seven
days a week)
US / CANADA / MEXICO
Working Visa and
Income Tax Specialists
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